by Conrad Robins | Oct 6, 2021
Background – Helping an architectural practice secure ownership of their premises
Some of the most rewarding cases that we get involved in raising finance for are those where the solution ends up being almost the opposite of where everyone expected it to be from the start. Giles Codrington, ASC Director in London, had one such case recently, which he helped the client to secure finance successfully. Our clients are the proprietors of a well-established business, an architectural practise currently operating from rented premises situated at Old Marylebone Road.
Challenges – Finding the right property and securing funding simultaneously
Our client’s plan was to move from their rented premise above, to freehold offices in North West London. We helped the client secure what they needed, £1,575,000 to complete the purchase of the new offices. We were able to do a first charge over the freehold of the office premises which our client (with an estimated value of £2,250,000) was paying £125,860 per annum in rent, and ASC ensured that the cost of servicing the loan would be the same monthly sum.
Solution – A proactive approach to loan approval before purchase
What was interesting in this case was that the approach the team used to get this favourable arrangement for the client was to get the loan approved in the first instance, before the client had found the property. That meant that he could look for properties with more confidence, speed up the transaction, and thus being able to negotiate the price more assertively.
Outcome – A successful purchase and valuable broker expertise
Giles comments,” This deal really highlights the importance of the knowledge a broker can offer through our service to securing finance for a client’s project. The client would just not have been able to approach things in this way without sound tailor-made advice.”
Is it worth taking a loan to grow your business? Well, that depends on each case. But, in general terms and if your business is viable, funds to help you expand as we see in this case, can mean more space, more employees, and more customers which can be an overall positive step.
As with any other financial product, each case is dealt with separately, and can be tailored to maximise the outcome. If you think your business may be able to take advantage of this type of financial product, please contact your local ASC office for more details.
by Conrad Robins | Dec 14, 2018
Background – From planning to a new development opportunity
Nick Ridgway acquired a property which he bought for cash and then set about gaining planning permission for a housing development project. After a 12 month period, he eventually got planning for the construction of 9 units and subsequently started finalising his plans for the project.
Challenges – When the bank refused to fund the build
He initially went to see his own bank who he had known for a number of years and had successfully completed previous projects with, to say that he was looking for funding for the development. They initially indicated to him that this would not be a problem, so he started working on the site by using his own cash to start the development. After a period of some time, and having had no feedback from the bank he chased them again only to discover that the bank announced they were not prepared to advance the funds due to their internal restrictions on development finance. This left Nick in a very difficult situation in that he had committed himself to the project and used most of his cash resources.
Solution – ASC steps in to secure full funding
He therefore took the opportunity to meet up with our ASC Essex Regional Director to discuss the situation. He reviewed the development plan and looked at his cash flow and requirements and was impressed with the information provided to him. He also delved into Nick’s experience and was satisfied that this was a sound financial project and was confident that he would have lenders who would be keen to back the project. As a result, Nick instructed ASC to help him put the funding in place and Steve set about the task with a clear timetable from Nick that the matter had now become urgent.
We therefore approached a number of development finance lenders and eventually decided on one of his main contacts to look at the project. The lender was very impressed with what he saw and within a fairly short timetable confirmed that they were prepared to advance 100% of the development costs, together with an interest roll up for a 12 month facility for him to finish the site and arrange the necessary sales. The legals as always took a little time to complete but after pushing from both Nick and ASC, they were able to complete the transaction within 6 weeks of their original meeting.
Outcome – Project back on track and lessons learned
Nick was mightily relieved when the funding was released and has been working on the site non-stop to get it completed during the summer period so he can start the sales process as soon as possible. He commented “I severely regret only speaking to my own bank when I initially needed the finance and as a result, their overall lending attitude gave me a lot of stress which if I had gone direct to ASC I would not have had. I would therefore recommend other clients in this situation to look at all the options first and speak to ASC Finance and use their experience of the sector to ensure they get the best deal available”.
